Entain\u2019s Turkish arm, Headlong, was so poorly overseen that employees were bribing Turkish officials and embezzling money from the online gambling giant, according to HMRC. (Image: ted Learning)<\/figcaption><\/figure>\nLondon-based law firm Fox Williams says it is preparing to file the suit. It accuses Entain of failing to keep investors abreast of an investigation by HMRC, the UK tax body, into bribery and corruption at its former Turkish arm.<\/p>\n
In November 2023, Entain agreed to pay \u00a3600 million (US$760 million) to resolve the case, one of the biggest corporate fines ever seen in the UK. <\/strong><\/p>\nShares in the company have nearly halved since May 2023 when it warned shareholders it expected to pay a \u201csubstantial financial penalty.\u201d<\/p>\n
Fox Williams said this week argued Entain had failed to \u201creport honestly (or at all) to investors regarding its knowledge of (among other wrongdoing) bribery and corruption\u201d in its Turkish subsidiary, Headlong, between 2011 and December 2017.<\/p>\n
Palms Greased<\/strong><\/h2>\nHeadlong once accounted for a third of Entain\u2019s revenues. Online gambling is illegal in Turkey, and so the subsidiary had been using shady cash-collection networks and payment processors to hide transactions from Turkish financial institutions. It had also allegedly been bribing Turkish officials to turn a blind eye to the operation.<\/p>\n
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Entain, then known as GVC, offloaded Headlong for free in December 2017 to grease the skids on its takeover of Ladbrokes-Coral, which completed in March 2018. Clearly, it was felt that its Turkish ops would not sit well with UK regulators scrutinizing the Ladbrokes deal, or with potential financiers.<\/p>\n<\/div>\n
HMRC announced\u00a0in July 2020 that it was examining \u201cpotential corporate offending\u201d by the Turkish arm, which sent Entain\u2019s shares spiraling by 12%.<\/p>\n
Ultimately, Entain was accused by HMRC of failing to have the right protocols in place to stop Headlong employees engaging in bribery. In fact, the unit was so poorly overseen that some of its employees were siphoning off money.<\/p>\n
Corporate Misbehavior <\/strong><\/h2>\nEntain could have been prosecuted under the UK Bribery Act, but there were concerns this could result in it losing its licenses globally, putting thousands of jobs at risk.<\/p>\n
This claim will offer institutional investors the opportunity to recover substantial losses but more importantly serve to improve transparency and governance within the UK\u2019s gambling sector, reminding public companies that they need to take their disclosure obligations seriously,\u201d Andrew Hill, a partner at Fox Williams said.<\/p><\/blockquote>\n
\u201cHopefully this will therefore have the knock-on effect of improving corporate behavior, because public companies should know that their shareholders won\u2019t let them get away with misconduct,\u201d he added.<\/p>\n
Entain said it was unaware of any litigation but added it would defend any such action \u201crobustly.\u201d<\/p>\n","protected":false},"excerpt":{"rendered":"
UK online gambling giant Entain is facing a class-action lawsuit from investors that could see it on the hook for \u00a3100 million (US$118 million.) London-based law firm Fox Williams says it is preparing to file the suit. It accuses Entain of failing to keep investors abreast of an investigation by HMRC, the UK tax body, […]<\/p>\n","protected":false},"author":36,"featured_media":322649,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[21,33810,19,60],"tags":[82759,91300,91296,91297,91298,91299],"acf":[],"yoast_head":"\n
Entain Facing \u00a3100M Class Action Lawuit Over Turkish Bribery Probe<\/title>\n \n \n \n \n \n \n \n \n \n \n \n \n\t \n\t \n\t \n \n \n \n \n \n\t \n\t \n\t \n